Uber Technologies (UBER  ) was one of the companies most negatively affected by the pandemic as the total halt in travel and nightlife reduced demand for its services. It has recently been in the news due to its Q4 earnings and the U.K. Supreme Court ruling that classified drivers as workers which makes them eligible for benefits.

This ruling caused shares to slip, however, the stock has been doing well overall with a 16% gain YTD. The primary catalyst has been optimism around the vaccine and falling case counts which has lifted all sorts of "reopening" stocks.

Inside the Numbers

Given these more important drivers, it's not surprising that Uber's Q4 earnings didn't have a material impact on share prices. The major takeaway is that its losses are narrowing, and its food delivery business continues to gain steam.

Uber posted a loss of $0.54 per share which was slightly better than expectations of $0.56. Revenue came in at $3.17 billion versus $3.58 billion consensus. Overall, Uber lost $968 million on a GAAP basis which was a slight improvement from last year's $1.1 billion. In total, Uber lost $6.8 billion in 2020 which was an improvement from 2019's $8.5 billion loss.

Given the coronavirus, it's not surprising that ride-sharing revenue dropped by 50% to $6.8 billion, while food-delivery revenue increased by 130% to $10.1 billion for the full year. However, in Q4, ride-sharing revenue did show some strength and exceeded food-delivery revenue for the first time since the pandemic started. If the world does return to normal by the second half, ride-sharing should explode higher, while food-delivery growth will likely see some short-term slippage.

Uber CEO on the conference call said that he expects demand to be strong for ride-sharing especially as cities return to normal. One challenge could be having enough drivers to meet this demand. Another announcement was the acquisition of Drizly, an on-demand alcohol delivery app, which it will integrate into UberEats. It's also adding non-food deliveries to the platform like pharmacies and retailers.

Overall, UberEats has 35% of the market in food-deliveries with DoorDash (DASH  ) as the only company with more market share. It also says that the number of paying members for Uber Eats Pass is 5 million which gives customers a discount and shorter delivery times.

Stock Price Outlook

On the surface, Uber's results aren't too encouraging especially as shares are at close to all-time highs. It continues to lose money, and investing in the company is an implicit bet that the company will be able to continue treating its drivers like independent contractors.

Looking ahead, the story is more constructive. The pandemic enabled UberEats to grow into a $10 billion business. Ride-sharing revenue will likely rebound to pre-pandemic levels when the economy reopens and likely more if there is pent-up demand as expected. Additionally, the pandemic caused many smaller ride-sharing companies, around the world, to have to shutdown. This means it'll likely face less competition and have more pricing power in the coming years.